US President Barack Obama, whose political fortunes are threatened by rising gasoline prices, proposed new measures on Tuesday to reduce oil market manipulation that are unlikely to get support from a divided Congress. Obama called on lawmakers to raise civil and criminal penalties on individuals and companies involved in manipulative practices.
He also pressed for more money to fund the agency charged with policing the markets to hire "more cops" for oversight and upgrade old technology. Republicans, who blame Obama's energy policies for high gasoline prices, called the effort a political gimmick. "We can't afford a situation where speculators artificially manipulate markets by buying up oil, creating the perception of a shortage, and driving prices higher, only to flip the oil for a quick profit," Obama said in the White House Rose Garden.
"We should strengthen protections for American consumers, not gut them," he said. Republicans said the new measures would not help Americans struggling with high gasoline prices. "It probably polls pretty well, but I guarantee it won't do a thing to lower prices at the pump," said Senate Republican leader Mitch McConnell. Gasoline prices have surged nearly 50 cents since late January, as tensions in the Middle East and supply disruptions bolstered oil costs. While prices at the pump have eased slightly in the past two weeks, gasoline remains around $3.92 a gallon nation-wide.
Obama has spent weeks trying to show he is on the case to bring down energy costs over the short- and long-term. Under his proposals unveiled on Tuesday, civil penalties for firms involved in market manipulation would rise to $10 million from $1 million and would be assessed for each day the manipulation occurs rather than on a per-violation basis.
Maximum criminal penalties would rise to $10 million as well. Obama also Congress to give the Commodity Futures Trading Commission authority to require traders to have more collateral when they trade oil in an effort to reduce risky trading.
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